Judge blocks Brazil assets of Vale, BHP Billiton

A judge has blocked the Brazilian assets of mining giants Vale and BHP Billiton to make sure they pay reparations for the toxic waste dam burst that killed 17 in November.

The Brazilian and Anglo-Australian mining companies are joint owners of Samarco, a firm that operated an iron ore tailings dam that burst in Minas Gerais state on November 5.

The accident unleashed a tsunami of toxic waste that buried a nearby village, then rushed into the Doce, Brazil's second most important river, ravaging flora and fauna for some 800 kilometers.

The sludge reached the Atlantic 17 days later, where it soiled beaches and damaged sea life.

The accident is considered Brazil's worst ever environmental disaster.

Brazil plans to sue Vale and BHP Billiton for $5.2 billion for clean-up costs and damages relating to the disaster.
In the ruling issued Friday, a Minas Gerais judge said that Samarco did not have enough money for the full cleanup and compensation, but that the parent companies could be held responsible.

"In 30 days, the companies should make an initial deposit of two million reais (about $502,000) to carry out the full recovery plan," the judge ruled, according to the state news agency ECB.

The companies also have 45 days to present a plan to address the social and environmental impact of the accident.

Vale and BHP Billiton will be fined $37,000 a day if they fail to comply, the ruling said. Samarco was also banned from distributing dividends or other earnings to shareholders.

A BHP spokesman said in a statement Sunday that it could not comment on the ruling as the miner had yet to receive formal notification of the decision.

"We are committed to supporting Samarco to rebuild the community and restore the environment affected by the breach of Samarco's Fundao and Santarem tailings dams, in the state of Minas Gerais on 5 November 2015," the spokesman added.

Global ratings agency Moody's on Friday placed the credit ratings of BHP on review for possible downgrades amid persistent weaknesses in commodity prices.

BHP's share price has fallen more than 40 percent on the Australian Securities Exchange this year.

At least 10 years will be needed for conditions to return to normal in the river basin, Environment Minister Izabella Teixeira said.
Source: AFP